Brookdale Senior Living, Ventas and CareTrust REIT all held second-quarter earnings calls on Friday.
Brookdale Senior Living
Brookdale Senior Living on Friday reported revenue of $723.3 million in the second quarter.
Revenue per occupied unit increased 4.2% year-over-year and improved on a sequential basis in the second quarter, Executive Vice President and Chief Financial Officer Steven Swain said on an earnings call.
“This momentum is a good sign as we enter the third quarter, which historically delivers the strongest sequential occupancy growth,” he said.
Swain said this was the first time occupancy grew in a quarter since 2019.
“We’ve made great progress this year to capitalize on the opportunities,” Brookdale President and CEO Lucinda “Cindy” Baier said.
Community operating expenses decreased $55.2 million (9.1%) in the second quarter of 2021 compared with the second quarter 2020. This decrease primarily was due to a $50.9 million decrease in COVID-19 expenses, labor costs for home health services, and food costs.
As of July 1, Brookdale’s liquidity has been strengthened by more than $300 million with the “completion and smooth transition” of its home care, hospice and outpatient therapy business to HCA Healthcare, Baier said.
See more coverage of the earnings call by McKnight’s Senior Living.
Ventas
“The demand for senior housing has been robust and sustainable, proving the value proposition our communities and care providers offer to seniors and their families,” Ventas Chairman and CEO Debra A. Cafaro stated Friday on the real estate investment trust’s earnings call.
Ventas’s total 2021 investments completed or announced to date are $2.6 billion. Seniors housing operating portfolio net operating income totaled $111 million in the second quarter, Cafaro said. Same-store cash NOI in second quarter increased $50 million on an annualized basis compared with the first quarter, excluding grants from the Department of Health and Human Services that were received in the first quarter.
As of Aug. 5, Ventas reported liquidity of $3.3 billion, including $2.7 billion of undrawn revolver capacity, $0.6 billion in cash and cash equivalents on hand, and no commercial paper outstanding.
“With vaccination rates rising, we believe Ventas can improve profitability and its
financial condition over the next few years. Over the long term, we believe Ventas will grow its dividend 3% annually, in line with our long-term earnings growth expectations,” Kyle Sanders, a financial services analyst for Edward Jones, told the McKnight’s Business Daily.
“[Funds from operations] remains roughly 25% below pre-pandemic levels, largely due to headwinds within Ventas’ senior housing segment that was hit hardest. While challenges remain, trende are improving within senior housing,” Sanders said.
The third quarter is off to a strong start,” said Justin Hutchens, Ventas’ executive vice president of senior housing North America.
See more coverage of the earnings call by McKnight’s Senior Living.
CareTrust REIT
“In Q2, we continue to methodically execute on our long-term business plan in spite of the near-term challenges posed by the pandemic,” CareTrust CEO Greg Stapley said on Friday’s earnings call.
“We’ve acquired some great facilities, refinanced some higher cost debt, raised a little equity … collected all of our contract rent and continued to refill our pipeline,” he added.
CareTrust realized a net income of $21.3 million, which is a 12.6% increase over the same time period last year.
During the quarter, CareTrust and its subsidiaries completed a private offering of $400 million aggregate principal amount of 3.875% senior notes due 2028. The new notes were issued at par and produced net proceeds of approximately $393.8 million after deducting underwriting fees and other offering expenses.
“We continued to be aggressive on the acquisition front that we believe will be accretive to not only us but our operators as well,” Chief Investment Officer Mark Lamb said on the call.
The REIT added three properties to its portfolio in two separate transactions in the second quarter.
“This year more than any other has highlighted the importance of our longstanding relationships in the industry, as all of our acquisitions have been off-market or narrowly marketed deals,” Lamb stated in a Thursday press release issued in conjunction with the earnings call.
See more coverage of the earnings call by McKnight’s Senior Living.
